Wednesday, December 24, 2014

Hello Friends, LBT Consultants,Visitors(Please read below only if you live in and around thane, as this post only applies to them)There is a new career opportunity developing for all aspirational CA, CS, lawyers or who already are CA, CS, lawyers..

I need not specify all the new opportunities GST shall bring, but to list a few - Consultation, Systematic & In-depth accounting, Audit, Representing clients in tax Dept..

We have to start early, if we were to grab this opportunity..With this in mind, starting a GST forum for those who inspire to make career in GST for people living in and around thane.We shall meet monthly, have chat group, undertake study of GST, effects of GST in particular industry, study all the aspects of GST.

For those who wants to keep track of GST, similar to this blog on LBT, have started with GST blog few months back - indirecttaxin.blogspot.comSubscribe to GST, by entering your email ID
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Monday, December 22, 2014

Good news for traders who are baffling with LBT.122nd Constitution Amendment Bill for GST is tabled in parliament. This bill shall lay foundation for GST, as it shall make changes in taxation lists i.e. - Union, State, Concurrent list to provide for a unified single indirect taxation.

The list of taxes which shall be subsumed in GST now officially contains all types of Entry Taxes. Hence, LBT will now be gone once GST will be in effect from 1st April 2016.

Saturday, December 20, 2014

It is true that one cannot break the law, irrespective of his or her position or influence, and if it is broken, one should be held responsible for it, and for that purpose, one could be punished in connection with severity of the crime, but if the law itself is made against the human rights and responsibility, then ?.The endeavor of the government to collect the revenue through the legal arrangements was started by the Roman empire and had named it as ‘Octroi’ for the first time, which was later adopted by the world, and we too, followed it !

This arrangement was continued by the Local Body, till last to last year.
But two years back, the State decided to phase out Octroi and phase in Local Body Tax, which was not happy ending of the problems. In 1987, a Committee under Maharashtra’s former Chief Secretary, Shri P.D. Kasbekar had recommended a Local Body tax, in place of Octroi. After various committee meetings and about several years of deliberating, Maharashtra has finally decided to implement LBT in some Corporations phase wise. Why this new law was made forceful this much late ?The reason, it was not suitable !
Octroi is a one time tax imposed on entry of all goods, but it has some difficulties too. Under LBT, traders and manufacturers are required to keep their monthly record. There are other taxes existing like Excise Service Tax, VAT etc. including LBT, and now GST has also started peeping in. Currently, the protest against Local Body Tax has increased in a very severe manner.This reflection is due to feeling of harassment to the traders.
Over the last decade, all States except Maharashtra have replaced octroi by other taxes, e.g. Tamil Nadu, it fixed flat 2 % rate, and it also restored it. Gujarat abolished octroi and instead hiked VAT rates by 1 percent. The octroi was simple in procedure to be followed, where as in LBT, though it is an alternative to octroi, the heavy compliance is amounting to complication, therefore, LBT too, is lacking the cent percent.

Friday, December 19, 2014

No end in sight to local tax issue as alternatives - turnover & entry tax cut no ice with biz-men Maharashtra Chief Minister Devendra Fadnavis' effort to find a compromise solution to the local body tax (LBT) seems to have again run into a wall with the traders' body showing little interest with the options offered by the new CM.

Fadnavis had said that his government would withdraw LBT soon and that a `solution' is in the `final stages' even as it held out two options -turnover tax and entry tax. Both options, however, failed to cut much ice with the traders.

Mohan Gurnani, president of the Federation of Associations of Maharashtra (FAM) that is negotiating with the state government on behalf of the traders’ body, said they were not happy with the options.

“The turnover tax is more draconian than LBT. For instance, under this, if a manufacturer sells a match box to a wholesale dealer, then he would have to pay a turnover tax, while the wholesaler would also have to pay a tax if he sells the match box to a semi-wholesale dealer, and the latter would have to pay the same tax if he sells it to a retailer. The retailer would also have to pay a turnover tax if he sells it to a customer. This would lead to a cascading effect on the prices and is not at all workable,” Gurnani claimed.

The traders are also opposed to the entry tax, which Gurnani claimed is just another form of octroi. “It’s basically an other form of octroi called the entry tax whereby goods coming in the jurisdiction of a municipal corporation or council limits have to pay tax. We oppose this as it is just another form of levying octroi which we have opposed,“ he added.